Do you know exactly what’s going into your payroll services in Australia? You should. Of course, the days of business micro management by the boss are gone- if you can’t learn to delegate to properly trained, trustworthy staff you are failing as a business owner.

However, the responsibility still does fall on your shoulders to ensure that all of your varied business process are running smoothly and without fraudulent practice. While there’s no need for you to be able to fully understand the often complicated payroll processes, there are some common sense things you can look out for to ensure you aren’t a victim of fraud.

Why payroll services fraud?

Payroll services fraud is more common than you may imagine. A lot of cases never reach the courts, as it’s next to impossible to recover the funds. This means this is an issue usually handled by internal HR rather than the court system.

One of the first and most vital steps you need to take is to ensure that you have a proper audit system in place- and that it’s being used as it should. The audit trail will usually lead you straight to abnormalities and fraudulent activity. A good auditor can often pluck it straight out the audit record. Make sure that your auditing process is enabled, so that the information will be there when you need.

What else should I watch out for?

Masterfile changes need to be investigated properly. Of course, there are dozens of legitimate reasons for bank details and leave balances to be altered for your employees, but if there seems to be a spate of regular Masterfile changes it’s worth investigating in case of fraud in your payroll services.

A related field is, of course, ghost employees or the duplication of employee data. It’s rare indeed to have duplicate names, common dates of birth etc. within a company. Look out for duplicate data or the entry of totally fraudulent fake employees into the register. Learn more here!

Keep a tight reign.

Of course, a lot of this boils down to ensuring you have adequate security in place. Only the people directly involved with the processes of paying your employees need to have access to the payroll system. Even senior management doesn’t need access unless they have a role to play. The less fingers in the pot, the less the chances of fraud- and the more innocent people who do not need fingers pointed at them in the case of fraud. One major security red flag to look for is out of hours system access.

Most people do not have the balls to run fraudulent activities in the middle of normal hours, and may remote access or work late to avoid people seeing their activity. Another major part of ensuring tight payroll security is preventing the use of shared log-ins and allowing old profiles to linger.

A shared login is just asking for payroll services fraud. Anyone with a genuine need to work the system should have their own log in. Likewise, don’t leave old profiles of people who’ve left the company or changed departments active. This prevents third parties getting access to the details to use fraudulently.

Running your business with a high number of casual employees is not a red flag for fraud itself, but does create a situation in which it is easier to create fraud. Make sure you have a good payroll services system in place to avoid fraud. Read our another article: https://uk-accountant.org/can-online-payroll-benefit-your-business/